Austin-based NetSpend is expected to price its IPO on Thursday, Oct. 13, a source familiar with the matter said. The company is expected to trade under the ticker “NTSP.”
NetSpend provides reloadable prepaid debit cards to the underbanked U.S. consumer. Today, NetSpend set the terms of its offering: 18.5 million shares at $10 to $12 each via book runners Goldman Sachs, BofA Merrill Lynch and William Blair & Co. Other underwriters on the deal include SunTrust, Wells Fargo Securities, Duncan Williams and Knight/Houlihan Lokey.
Of the 18.5 million shares being offered, NetSpend itself is selling about 2.3 million shares. Other stockholders are offering approximately 16.2 million.
The IPO market has been rocky recently. Last week, New York Liberty Mutual Group, which was expected to be one of the bigger IPOs of the year, postponed its $1.2 billion deal.
NetSpend is expected to have about 80.9 million shares outstanding, giving it a roughly $890 million market cap (assuming an $11 offer price). NetSpend said it would receive about $21.4 million in net proceeds from the deal and will likely use a portion to pay off debt.
The company reported about $137 million in revenue for the six months ended June 30, up roughly 25% from the $109.6 million for the same time period in 2009. Net income was flat at about $11.1 million. Long term debt, as of June 30, was $45.7 million.
Oak Investment owns 46.5% of NetSpend, while JLL Partners has 32.2%, according to an Oct. 4 regulatory filing. Their holdings will fall minutely with the deal. Oak Investment is selling about 5.1 million shares and will see its holding fall to 39%. JLL Partners is offering 3.5 million shares and its stake will drop to 27%.
The Texas Growth Fund owns 4%. The firm is offering about 2.8 million shares and would see its stake fall to less than 1%. Millennium Finance Co., which owns roughly 4.8 million shares, or 5.6%, is not selling anything, according to the regulatory filing.